A fall in exports of gems & jewellery, petroleum products, readymade garments and farm products pulled down India’s overall exports (year-on-year) by a marginal 0.6 per cent to $29.11 billion in March 2018.
Exporters are worried as several of the sectors that have taken a hit are labour-intensive, which they say is due to liquidity problems.
Exports, however, grew 9.78 per cent to $302.4 billion in the April-March 2017-18 period, which was the highest in the last three years, as per data released by the Commerce Ministry on Friday.
The trade deficit widened to $13.69 billion in March 2018 from $10.65 billion in the same month last year, as imports during the month were 7.15 per cent higher at $42.80 billion.
The trade deficit in April-March 2017-18 increased by almost 50 per cent to $156.83 billion, with imports during the fiscal year rising 19.59 per cent to $459.67 billion.
The increase in imports in March 2018 was largely attributable to a rise in petroleum, chemicals, machinery, transport equipment, iron & steel and coal & coke. Gold imports, on the other hand, declined by 40 per cent to $2.49 billion.
“We are concerned and worried about labour-intensive sectors such as gems & jewellery, readymade garments, jute manufacturing, agriculture products and many other sectors of exports dominated by MSME, which are in negative territory. These are still facing the problem of liquidity as banks and lending agencies are tightening their norms, which does not augur well for exports for the new fiscal year,” said Ganesh Gupta, President, Federation of Indian Export Organisations.
The decline in goods exports in March 2018 is a case of a missed opportunity, as major economies, including the US, are showing an uptick, said Ravi Sehgal, Chairman, EEPC.
“The engineering sector, which had been leading the basket of goods exports, could manage to grow only by a meagre 2.62 per cent in March, making it imperative to redraw our external trade strategy. This is all the more important in the backdrop of greater protectionism rearing its head. Rising raw material costs, among other factors, have had a crippling impact on the shipments,” Sehgal said.
Non-petroleum and non gems & jewellery exports in March 2018 were valued at $22.42 billion, which was 4.6 per cent higher than in March 2017, the release said.